SalmonState Criticizes AIDEA’s Loan Program

By JAMES BROOKS
Alaska Beacon
    An Alaska conservation group has released a new series of reports criticizing Alaska’s state-owned investment bank as ineffective.
    The reports, written by economists Gregg Erickson and Milt Barker on behalf of the group SalmonState, concluded that the Alaska Industrial Development and Export Authority’s flagship loan program created few new Alaska jobs, and has accumulated a large endowment with little oversight.
    “These in-depth reports clearly reveal AIDEA is lousy at job creation, provides an abysmal return on its investments, takes credit for jobs it shouldn’t, and successfully dodges meaningful legislative oversight,” said SalmonState executive director Tim Bristol in a prepared statement announcing the reports’ release.
    SalmonState is an initiative of the New Venture Fund, a left-of-center national organization, and opposes some of the infrastructure projects backed by AIDEA.
    The reports arrive as AIDEA seeks permission from the Alaska Legislature to borrow as much as $300 million for a variety of as-yet-unidentified mining projects.
    The new reports follow a 2022 analysis that found state spending on AIDEA had cost Alaska $10 billion over 40 years and resulted in lower financial returns than a comparable investment in the Alaska Permanent Fund Corp.
    That analysis did not account for job creation, something addressed in this week’s reports. One of those reports found AIDEA had overstated by 94% the number of jobs its loan participation program — used by smaller businesses — had created.
    SalmonState is among several conservation groups opposing plans by AIDEA, the Matanuska-Susitna Borough and the Alaska Department of Transportation to construct a highway across the Susitna River in Southcentral Alaska.
    AIDEA, which is also pursuing a 200-mile mining access road in Northwest Alaska and oil development in the Arctic National Wildlife Refuge, rejected the new reports’ conclusions.
    After the 2022 analysis, it commissioned a rebuttal report that remains in development.
    Randy Ruaro, AIDEA’s executive director, said by email that the agency disagrees with the new SalmonState-funded reports’ conclusions.
    “Northern Economics is still working to provide an independent analysis of AIDEA from an economic perspective. AIDEA has substantial programs and projects that have benefited Alaskans, so the task is complex to do a thorough and accurate job,” he wrote. “What we are seeing so far is very positive. Reports that have been done by environmental groups are flawed such as not including AIDEA’s premier project, the Red Dog Mine.”
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